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DECISION No

DECISION No. 08/1999/QD-CDTQG OF MARCH 25, 1999 PROMULGATING THE REGULATION ON BIDDING FOR THE PURCHASE/SALE OF NATIONAL RESERVE SUPPLIES-EQUIPMENT

DIRECTOR OF THE NATIONAL RESERVE DEPARTMENT

Pursuant to the Government�s Decree No. 66/CP of October 18, 1995 on the functions, tasks, powers and organizational structure of the National Reserve Department;

Pursuant to the Government�s Decree No. 10/CP of February 24, 1996 on the promulgation of the Regulation on National Reserves Management;

At the proposals of the head of the Legal Section and the head of the Planning Section,

DECIDES:

Article 1.- To promulgate together with this Decision the Regulation on bidding for the purchase/sale of national reserve supplies-equipment.

Article 2.- This Decision takes effect after its signing. All previous regulations contrary to this Decision are now annulled.

Article 3.- The Section heads, the chief inspector, the chief of the Department�s Office and members of the Bidding Council shall have to implement the Regulation attached herewith.

Director of the National Reserve Department

NGO XUAN HUE

REGULATION ON BIDDING FOR PURCHASE/SALE OF NATIONAL RESERVE SUPPLIES-EQUIPMENT

(Issued together with Decision No. 08/1999/QD-CDTQG of March 25, 1999 of the Director of the National Reserve Department)

Chapter I

GENERAL PROVISIONS

Article 1.- Interpretation of terms:

Terms used in this Regulation shall be construed as follows:

1. "Bidding" for the purchase/sale of national reserve supplies-equipment means a process of selecting bidders who meet the requirements of the bid solicitors.

2. "The bid solicitor" is the National Reserve Department or its attached unit(s), which buys and/or sells national reserve supplies-equipment under the annual plans by mode of bidding.

3. "The bidder" means organizations and/or individuals that are qualified for participation in the bidding for the purchase/sale of national reserve supplies-equipment.

4. "Bidding package" means the volume (quantity or weight) of supplies-equipment with certain quality criteria, which is divided according to the capability and purchase/sale terms of the bid solicitor. A bidding package may be a part or whole of the volume of each list of commodities that need to be purchased/sold, at each location.

5. "Bidding dossier" means all documents, tables and forms sent by the bid solicitors to bidders. In a bidding dossier, all requirements and conditions for the purchase/sale of national reserve supplies-equipment (Point 2, Article 8) must be fully stated.

6. "Bid" means all the official documents of the bidders sent to the bid solicitors, clearly stating their capabilities to meet the bid solicitors� requirements and conditions on purchase/sale of national reserve goods (Point 3, Article 8).

7. " Bid submission" means the submission of bids by bidders at the locations and within the time limits provided for in the bid invitation notice.

8. "Bid price" means the sum of Vietnam dong (VND) per calculation unit (kg, piece, set, machine�) written by the bidders in their price schedule submitted to the bid solicitor within the prescribed time limit and according to set form.

* Particularly for cases of purchasing goods imported in foreign currency(ies), the bidders shall base themselves on the exchange rate between VND and the foreign currency(ies) paid for the import of goods, which is announced by the State Bank of Vietnam or the competent agency at the time the bidding is organized, to determine the bid price. Such exchange rate shall also serve the bid evaluation price and inscribed in the record of bids opening and the declaration of bid winning for each bidding package.

When the bid solicitor makes the payment for the purchase of goods, on the basis of the import prices (CIF), taxes (if any) paid to the budget as prescribed by law and on the exchange rate between VND and the foreign currency (already determined when the bidding is organized and the letter of credit is opened) at the time of payment, the bid solicitor shall pay more or less than the difference between the exchange rate when the bidding is organized and the actual rate when the payment is made.

9. "The bid evaluation price" is the amount of VND per calculation unit (kg, piece, set, machine�) decided by the director of the National Reserve Department on the basis of prices prescribed by the Government Pricing Committee: the flooring price (for sale by the bid solicitor), the ceiling price (for purchase by the bid solicitor).

10. "Bid opening" means the opening of bids and price schedules offer at the time fixed in the bidding notices, which is effected by the Bidding Council.

11. "The bid winner" is the bidder selected under Article 17 of this Regulation, which has been approved by the director of the National Reserve Department.

Article 2.- Scope of application:

This Regulation shall apply to the purchase/ sale of national reserve supplies-equipment under the annual plans already ratified by the Prime Minister.

For cases where national reserve supplies-equipment are imported/exported by other decisions of the Government, the specific regulations shall apply.

Article 3.- Bidding forms and applicable modes:

1. Bidding forms: One of the three following forms shall apply:

a) Unrestricted bidding.

b) Restricted bidding.

c) Appointed bidding.

Particularly the restricted bidding and the appointed bidding shall apply only to special cases decided by the director of the National Reserve Department.

When the bid opening is organized following the announcement on invitation for bids as prescribed, the number of bidders participating in the bidding is unrestricted.

2. Applicable modes:

a) One dossier bag- bidding (one envelop):

Shall apply when the bid solicitor sells goods.

When participating in the bidding by this mode, bidders shall submit their bids including the price schedule) in one dossier bag.

b) Two dossier bag-bidding (two envelops):

Shall apply when the bid solicitor purchases goods.

When participating in the bidding by this mode, the bidders shall submit their own bids (on technical specifications of the goods items) and the price schedules into two separate bags simultaneously. The bag of dossiers on technical quality of the goods items shall be considered first for evaluation, classification and selection in conformity with the requirements stated in the bidding invitation notice. After the results of the evaluation and classification in terms of the quality and technical requirements on the goods items are available, the price schedule shall be considered in order to select the bid winner.

Chapter II

ORGANIZATION OF BIDDING

Article 4.- The bidding organizer shall be the National Reserve Department or its attached units authorized by the director of the Department.

Article 5.- Bidding principles:

1. The bidding is organized openly and equally among bidders in term of their interests and obligations.

2. Organizations and/or individuals relating to the organization of bidding and the selection of bids shall have to keep secret all relevant information during the bidding process.

3. The bid solicitor and the bid winner shall have to strictly fulfill their commitments on the purchase/sale of goods according to the bidding results through economic contracts.

Article 6.- The Bidding Council:

1. Organization and composition:

The Bidding Council is led by a leading official of the National Reserve Department as its chairman and composed of members being representatives of the Ministry of Planning and Investment, the Finance Ministry and the Government Pricing Committee, a leading official of each of the Planning, Finance-Accountancy, Preservation Technique Sections, chief-inspector or his/her deputy, chief of the Office of the Department or his/her deputy, and a number of expert consultants (if necessary). The list of the official members of the Bidding Council shall be decided by the director of the National Reserve Department. Where attached units of the Department are authorized by the Department director to solicit bids and organize the Bidding, the Bidding Council shall comply with the separate guidance.

2. Working principles:

Members of the Bidding Council shall work on the part-time basis.

When settling matters, the Bidding Council shall have to base itself on the bidding regulations and decisions of the director of the National Reserve Department concerning the organization of the bidding. The bidding results shall be announced by the chairman of the Bidding Council and shall be legally valid only after they are ratified by the director of the National Reserve Department.

A meeting of the Bidding Council must be attended by at least 2/3 of its members. The Bidding Council�s decisions must be approved by more than half of its members. In cases where opinions are divergent, the Council chairman shall reserve it and report to the Department director for decision.

The contents of meetings on bidding must be recorded in writing and kept according to the dossiers and documents- keeping regime prescribed by the State.

3. Tasks:

The Bidding Council is tasked to work out programs and plans and organize the whole process of bidding, including:

- Drawing up plans and preparing the bidding dossiers.

(The detailed list of bidding packages with types, specifications, quantity, weight, quality, location,�; bidding invitation notice; set form of application for bid participation by bidders; determining the criteria for bid evaluation and points scale; time limits for bid submission and opening; the duration of validity of bids; instructions and reply to questions of bidders; determining the bid security and performance security other matters if any).

- Having to organize the receipt, book-entry, sealing, management and keeping secret of bids.

The bids, after being opened, shall not be returned to bidders and shall be archived according to the State�s regulations on archives.

- Examining the validity of bids, scrutinizing bidders� qualifications for bid participation, opening bids according to schedule, evaluating bidding results as prescribed.

- Making bid opening record and publicizing it.

Article 7.- Conditions for bidding participation:

Each bidder shall have to submit bids as required by each bidding package. A bidder may participate in one or several bidding packages, but submit only one bid for each bidding package.

Bidders participating in a bidding shall have to meet the following conditions:

1. For import goods (purchased by the bid solicitor):

a) Having the establishment decision granted by the competent State body.

b) Having the production/business license as prescribed by current law.

c) Having capacity to produce and deal in the kind of supplies-equipment opened for bidding.

d) Having full financial capability to participate in the bidding.

e) Having filed bids to the bid solicitor in accordance with this Regulation.

f) Having made deposits for bid security and bidding organization expenses.

2. For export goods (sold by the bid solicitor):

The bidders have demand to buy supplies-equipment and meet all conditions prescribed in Clauses d, e and f of Point 1 above.

Article 8.- Bidding notice, bidding dossiers and bids

1. Bidding notice must conform to the bidding form and contain the following principal contents:

a) Name and address of the bid solicitor;

b) The requirements on the list, type, specifications, code, country producer, quantity, quality, catalogue, location of supplies-equipment.

c) Bid participation conditions;

d) Time-limit, location and procedures for receipt of bids;

e) Time-limit, location and procedures for bid submission;

f) Time (hour, day, month, year) and location for organizing the bid opening;

g) Instructions for inquiry into bids.

2. The bidding dossier includes:

a) The bidding notice;

b) Form of application for bid participation;

c) Conditions on goods delivery and receipt schedule and mode;

d) Financial conditions and mode of payment;

e) Form of economic contract for goods purchase/sale;

e) Form of price schedules;

f) Other instructions related to the bidding.

3. The bid includes:

a) The application for bid participation (stating the commitment on the list, quantity, quality, specifications, code, original catalogue and its Vietnamese translation of the goods, goods delivery and receipt schedule and mode, payment mode,�);

b) Price schedule;

c) The (notarized) copy of the decision on the establishment of the unit;

d) The certification of the deposit amounts;

e) Other commitments (if any);

f) Other relevant dossiers prescribed by the Bidding Council.

Article 9.- Time-limits for bid submission and bid opening, and the duration of validity of bids:

1. Time-limits for bid submission and bid opening: are provided for in the bidding notice. Within the bid submission time-limit, bidders shall have to submit all the prescribed dossiers to the bid solicitor.

Bids submitted beyond the prescribed time-limit shall not be accepted and be immediately returned intact to bidders.

2. Time-limit for bid opening: Within 5 days after the expiry of the bid submission time-limit, the bid opening must be organized.

3. The duration of validity of bids is the duration from the date the bid submission time-limit expires till the date the bid winning result is announced.

Article 10.- Amending bids

1. Bidders are not allowed to amend, replace or withdraw their bids after the expiry of the bid submission time-limit.

In the process of bid evaluation and comparison, the bid solicitor may request bidders to clarify matters related to their bids. The bid solicitor�s request and the replies by bidders must be made in writing.

2. In cases where the bid solicitor amends a number of contents in the bidding dossiers, the bid solicitor shall have to send the written amended contents to all bidders before the bid submission deadline but have to spare enough time for the bidders to supplement their bids.

Article 11.- Bid participation deposit:

The bid participation deposit is the sum of money the bidders have to remit into the bid solicitor�s fund or account opened at the State Treasury (if deposited into the State Treasury, the bidders shall have to submit the Treasury�s certification thereof when submitting their bids). The security level is stipulated as representing 2% to 5% of the estimated value of a bidding package but shall not exceed 100 million VNdong for a bidding package and such deposit shall not enjoy any interests.

The bid security shall be returned to the unsuccessful bidders immediately, if it is deposited in the bid solicitor�s fund, or within 05 days after the bid opening result is available if it is deposited at the State Treasury. For the bid winner, the bidding shall be transferred into the security for contract performance.

Article 12.- The contract performance security:

The deposit to ensure the contract performance is the sum of money transferred from the bid winner�s bid participation deposit in the bid solicitor�s account opened at the State Treasury or directly in the fund of the bid solicitor (that will submit this sum of money into the State Treasury).

Article 13.- Bid opening:

1. Bids submitted on time shall be publicly opened by the bid solicitor at the time and place stated in the bidding notice.

Bidders may attend the bid opening. If their representatives are sent to attend, such representatives must be the persons who have the responsibility and competence and can decide on spot matters related to the bidding.

Article 14.- Bid opening record:

When opening bids, the bid solicitor and the bidders (or their representatives) shall have to sign the bid opening record.

The bid-opening record must clearly state the name of the bidding package, the list, type, specification, quantity, quality�; the time, date and location of the bid opening; names and addresses of bidders; bid evaluation price, bid price; bid security; amended and supplemented documents and other relevant details (if any).

Article 15.- Considering bids when bid opening is organized:

1. Bid participation conditions, the validity of bids as prescribed. Bidders who fail to fully meet conditions and bids which are invalid shall be eliminated (without returning the bids).

2. The bid solicitor shall request bidders to clarify unclear contents in their bids, which must be made in writing.

Article 16.- Bids evaluation and comparison:

1. All valid bids shall be evaluated and compared by the bid solicitor on the basis of the criteria: the quality, the financial and professional capabilities, price, implementation tempo and other necessary criteria.

2. The criteria stipulated in Clause 1 of this Article shall be evaluated by method of point giving according to a point scale in order to classify the list of bidders. The standard point scale shall be stipulated by the Bidding Council before the bid opening.

Article 17.- Classification, selection and approving results:

1. Based on the results of evaluation of bids, the Bidding Council shall classify bidders by the prescribed method.

2. The bid winning results shall be decided on the basis of the requirements stated in the bidding notice. The bid winner among bidders who have met the bidding requirements shall be the one that has the lowest bid price offer in his/her/its price schedule (when the bid solicitor purchases goods) or has the highest price offer (when the bid solicitor sells goods) as compared to the bid evaluation price.

3. In cases where many bidders have all met the bid solicitor�s requirements and have the same bid price, the bidding package in negotiation shall be divided among bidders or the lots shall be drawn to select the bid winner.

4. The director of the National Reserve Department shall decide the bid winner after considering the results and the proposal of the Bidding Council.

5. In cases where no bidder participates in the bidding, or no bidder meets the bid solicitor�s requirements or where the bidding regulation is violated, thus making the bidding unfruitful, the chairman of the Bidding Council shall send report and propose settling measures to the director of the National Reserve Department for consideration and decision.

Article 18.- The bid winner shall have the responsibility:

1. Within 3 days, to sign the principled contract with the Department (when the bid solicitor purchases goods) or receive the order on goods sale (when the bid solicitor sells goods).

2. Within 7 days, to sign the contract for goods purchase/sale with the unit designated by the bid solicitor in strict accordance with the Ordinance on Economic Contracts promulgated on September 25, 1989 and the Regulation on Management of National Reserve Goods.

Particularly for import goods: Within 30 days, the bidder shall have to produce the foreign trade contract and L/C to the bid solicitor.

3. To effect the goods delivery/receipt and payment according to time schedule as committed.

4. If the bid winner fails to satisfy one of the conditions mentioned above, he/she/it shall be considered having cancelled the commitment at his/her/its own will. Such bidder�s contract performance security shall not be returned thereto but shall be remitted into the State budget due to the breach of contract. The bid solicitor shall select the runner-up bidder according to the bid-opening results, provided that the bid price offer of this bidder lies within the bid evaluation price bracket.

Article 19.- Contracts for purchase/sale of national reserve supplies-equipment:

1. A contract for the purchase/sale of national reserve supplies-equipment shall include the following principal contents:

- The names of the goods, their codes, specifications, country producer.

- Quantity.

- Quality.

- Price.

- Mode of payment.

- Location, mode, time and tempo of goods delivery and receipt.

- Each party�s responsibility for the performance of the contract.

- Liability for breach of the contract.

Besides, the parties may agree on other contents in the contract, which are, however, not contrary to the current law provisions.

2. The price stated in the contract is the bid winning price.

Article 20.- Expenses for organizing the bidding

The bid solicitor may collect fees to cover the expenses for organizing the bidding such as the costs of printing documents, books, information�; the collection levels shall be stipulated by the bid solicitor. The bidders shall have to pay the bidding fees when submitting their bids.

Where the bidding has to be reorganized, the bidders who have already paid the bidding fees shall not have to pay any more. If the fault is committed by the collective or individuals of the bidding organizing agency, the expenses for organizing the bidding shall be borne by such collectives or individuals.

Chapter III

INSPECTION, EXAMINATION AND HANDLING OF VIOLATIONS

Article 21.- Inspection, examination and handling of violations:

1. The Inspectorate of the National Reserve Department shall examine the organization of bidding for the purchase/sale of national reserve supplies-equipment; inspect acts of violating the Bidding Regulation.

2. All acts of non-observance of the Bidding Regulation in such forms as disclosure of secrete dossier, documents and information, collusion, taking bribe� in the process of bidding shall be considered acts of causing economic damage and must be handled as follows:

- If the bidders committed the violation, they shall be eliminated from the list of bidders and shall not be entitled to get back their bid security. If the violation cause serious losses, they shall be handled according to law.

- If the bid solicitor committed the violation, the bidding results shall be cancelled. The director of the National Reserve Department shall direct the re-organization of the bidding. If members of the Bidding Council committed the violations they shall be eliminated from the list and administratively disciplined or handled according to law, depending on the seriousness of the violation.

3. All complaints and disputes about matters related to the organization of the bidding shall be replied by the bid solicitors, based on the Complaints and Denunciation Law (No. 09/1998/QH10). If the complainants dissatisfy with the replies, they may lodge their complaints to competent bodies for settlement.

Chapter IV

IMPLEMENTATION PROVISIONS

Article 22.- Organization of implementation: The Section heads, the chief inspector, the chief of the Department�s Office and members of the Bidding Council shall have to implement this Regulation. If any problems arise in the course of implementation, they are requested to report to the director of the National Reserve Department for consideration, proper amendments and supplements.

Article 23.- Implementation effect:

This Regulation takes effect after its signing. All previous regulations contrary to this Regulation shall be annulled.

Director of the National Reserve Department

NGO XUAN HUE